CINCINNATI - An Oregon investment group bought Tri-County Mall for $45 million at sheriff's auction Thursday, outbidding by $10 million a New York investor who owned the property's mortgage.
American Pacific International Capital Inc. of Portland, Ore. was a surprise bidder at the court-ordered auction.
The company is backed by Chinese investors, looking to make real estate acquisitions in the U.S., China and Southeast Asia. Among its U.S. acquisitions is the KOIN Center in downtown Portland and San Francisco's Hotel Vertigo and Hotel Metropolis.
A 2011 profile of American Pacific President Wilson Chen said he came to Oregon from China with $3,000 in the early 1990s. He took advantage of the U.S. recession to acquire hotel and office properties, along with a soybean factory and oceanside resort in his hometown of Shantou in China's Guangdong Province.
In an interview following Thursday's auction, Chen said his company will invest in the mall and retain it as a retail property. He wouldn't say how much the company is prepared to invest.
"We will an expert come to assess that," he said, with the goal of making the mall "a destination center in the area."
The mall is 60-70 percent occupied and he said Chen hoped to bring it back to its former glory.
"There's great potential," he said. "It's a good location."
The $45 million auction price was a bargain compared to the mall's last sale price of $179.5 million in 2005. Hamilton County's sheriff valued the property at $52.5 million in advance of Thursday's auction. The mall went into foreclosure after its prior owners were unable to cope with its debt load, which grew to more than $200 million by the time a New York investment group acquired the mortgage note earlier this year.
Investor Daniel Ridloff, who recently introduced himself to Springdale officers as the mall's likely next buyer, said he was prepared to redevelop the mall himself, but decided to sell because "They were willing to pay a price ... We still think it's a trophy asset for the area. We were fully prepared to move forward with our business plan."
Ridloff had discussed with Springdale city officials a plan to bring new retail tenants to the mall, including Earth Fare, an organic food retailer. Springdale Economic Development Director Jeff Tilloch was surprised that a new buyer emerged, but remains confident that the mall will be developed.
"As long as there is a party with some capital backing that has acquired the property, we're pleased about that," Tulloch said. "The mall needs to be redeveloped. They seem to be committed to it."